We don’t live in a 5-star world. Think about it: Even your favorite restaurant messes up sometimes. Even your favorite doctor, grocery store, or book store has a bad day. We all do.

So why do small business owners think that negative reviews are the kiss of death online? Why do retailers, manufacturers, and local service providers live in fear of just one bad review on their Google Maps Local Business Listing, or on Yahoo Local, Yelp, and so forth? I’m sure it’s human nature to dislike getting negative reviews, but disliking them doesn’t mean they’re a Bad Thing; it actually means you don’t understand the benefits of a negative review.

How Negative Reviews are Good for Business

1.) They create trust. Admit it: When you’re on the web site of a business you’ve never heard of, and you see nothing but 5-star testimonials and reviews, you start to wonder, Are these real or fake? It’s natural. We all do it. When we see a product or business with nothing but glowing reviews, we don’t trust it. At the Internet Retailer conference last week, a speaker from evogear.com put it this way:

“We solicit negative information and make it highly visible. People seek out negative information and omission erodes trust.”

(emphasis mine)

Negative reviews provide balance. No one expects a product or service to be perfect for every person. Negative reviews help customers confirm they can live with the product’s faults and/or the company’s faults.

2.) They provide honest feedback. Reviews of your product or service are a focus group of sorts; honest reviews tell you what you’re doing right and wrong. Rather than avoid negative reviews, use them to improve your products, services, or business processes. If a customer is legitimately reporting a problem, the smart business owner should want to fix that problem, not brush it under the rug and pretend it doesn’t exist.

3.) They can improve your SEO. You’ve probably heard that good keyword research and good copywriting involves targeting the terms that your customers use. Well, negative reviews offer a peak into how your customers talk about your business or products — the terms they use, the concerns they have, the places where there’s friction between what you advertised and what you delivered. There may be good keyword research and copywriting ideas in those negative reviews. Read this old (June 2008) article by Linda Bustos, Improving Product Descriptions Using Competitor Customer Reviews, for more ideas along these lines.

4.) They help you make better business decisions. If one of your products or services continually gets negative feedback from customers, that’s a strong hint that you should either make dramatic improvements in the product/service or just get rid of it altogether. If customers consistently don’t like the Chicken Curry, take it off the menu. If patients love how you take care of them, but repeatedly say your waiting room is too small or too loud, it’s probably time to make some facility improvements.

5.) They offer a golden opportunity. The saying is something like, Life is 10% what happens to you and 90% how you react to it. I believe that. A negative review is an opportunity for you to shine, to show you care about making things better — not only for the customer who left the negative review, but also for the countless others that are reading. There are plenty of negative reviews out there, but far fewer stories about how the small business turned the negative review into a positive. If you can do that, people will notice. They’ll tell their friends what you did, how you turned a bad experience into something good. And you’ll be better off in the long term because of it.

Try to identify unhappy customers before they finish their transaction with you.

Respond to negative comments with sincerity, transparency, and consistency. Apologize for the incident. Explain how it happened, why it’s not the normal way you treat customers, and how you’re working to ensure it never happens again.

Encourage your happy customers to post their reviews too.

I’d add a fourth item: Learn from your negative reviews. Turn them into opportunity, as I touch on above. And read this post about responding to reviews, in which Miriam Ellis details which local sites allow business owners to reply to negative reviews.

Final Thoughts

There’s no doubt that positive reviews are a Good Thing. And small business owners should be active in encouraging happy customers to review you on Google Maps, Yahoo Local, Yelp, and other local/social sites. But it’s unlikely that you’ll go your whole business life without a negative review. Poop happens, and people sometimes write about it.

Negative reviews for small/local businesses are a bigger problem when they’re the only review(s) of your business to be found online. But they don’t have to be a kiss of death for your business. The occasional negative review creates balance and trust because people tend to be skeptical when they see nothing but 5-star reviews. Negative reviews also offer an opportunity to make things right and show you care.

Don’t be afraid of a negative review. Use it for your own benefit. Turn it into something that’s good for your business.

Great post Matt! The entire realm of social media provides opportunities for the small business owner who capitalizes upon the engagement opportunities – negative and positive. Who is better than the small business in handling personal relationships with customers? Once the business puts a communications strategy in place, they will mine the opportunities to the mutual benefit of their business and the customer.

I think #4 is the biggest factor for me Matt. This is exactly what I try to teach businesses that come to me looking for rep management etc. First, be open to learning what the problem is, second accept you have a problem and third (use that feedback) FIX THE PROBLEM!! I wish you had more time for posts here Matt cause you do such a great job with them!

I agree that you actually win points by admitting your faults. Nobody believes that a product has no faults any more, today’s consumers are too smart. If there’s a way the business can post a response to negative reviews explaining how they’ve acted to fix the problems, that would certainly garner consumer trust.

Excellent advice Matt. In regards to trying “to identify unhappy customers before they finish their transaction with you” we’ve taken that a step further, or rather a step back.

After years of providing services to clients we’ve found it’s important to get a good idea what expectations they have before they do business with us.

Since most 1st time clients call to make appointments we’re in a position to handle that effectively. There’s been many times where either I or staff have recommended services (or locations) other than what we provide.

When you are new in business you often want to do business with everyone, but after several years of service, you discover what clients fit your business model best. There’s goodwill in referring those that may be better suited for another business and there’s hidden rewards that come with applying such an approach.

I have to agree! Obviously, you must respond properly and implement fixes to problems or issues that are negative (and you don’t want a large amount of negativity)… Ultimately, you may think you are doing everything right – while your consumer base has issues that you are unaware of that are keeping you from flourishing…

Good post. I must admit I do put fake posts up from time to time, but users would surely get suspicious with too many positive reviews. I also run a weight loss website and find that often the negative feedback sparks us into action and we often get to the bottom of long standng bugs and other issues.

Thanks for all the generous feedback, folks. Michael – great point about fleshing out potentially bad-match clients before they become clients. I do the same thing with SEO consulting prospects, now that you mention it. 🙂

amazon.co.uk have started to delete the bad reviews on a more frequent cycle than good reviews leaving a skew towards good reviews. It sets a bad president to other businesses big and small that this is a good thing to do. It fooled me a couple of times and when i figured out all review had this pattern i felt betrayed. it sad that such a nice business would do this.

What an empowering post, Matt. Criticism of any kind can be hard to deal with, especially if we have a tendency to personalize business criticism. I think you’ve done a remarkable job here of…counseling is the word I’m leaning toward…business owners into a positive attitude about negative reviews. Super read.

Great article. The problem for some businesses is that they ignore the online world. They think if they don’t have a website, don’t participate, they are safe. This is like an ostich sticking it’s head in the sand. The conversation is going on, businesses, no matter what size, have to engage in that conversation.

Matt, great post! As you’ve pointed out, a negative review every now and then can add credibility to the positive reviews a business collects.

However, I’ve found that most small businesses have a hard time implementing the changes that might be suggested by a negative review or even comments in a positive review. It’s easy to promise the disgruntled customer that “it will not happen again,” but too often the action taken is a memo to employees or a yellow post-it on the break room bulletin board. Soon the memos and post-its on the board are covered by new memos and post-its and the problems resurface.

To effectively respond to a customer call to action requires two things — (1) a method of implementing a changed work process or training change, and (2) a tracking system to monitor these changes and document completion. This doesn’t have to be difficult, but it does require some structured thinking and management action.

When you have this process improvement and bug tracking system working for your business, you can report your actions to the complaining customer with some assurance that the missteps won’t be repeated.

A professor I work with did an informal survey of his class. He showed them 3 products with an equal number of reviews. One had all 5 star reviews, one had majority negative reviews, another had a healthy distribution of good and bad reviews. A majority said they would pick the one that had good and bad reviews because the reviews looked more authentic than one with all 5 star reviews (which could have been gamed in their eyes).

Julie, thanks for that information. It’s circumstantial evidence that business-provided testimonials are not given much weight by consumers because they also could be gamed. Third-party websites hosting positive and critical reviews are much more credible to consumers.

Legitimate negative reviews are great for the reasons you mention, but it’s tough for SMBs when the #2-#4 result on their company are fake RipOffReports filed by a competitor. (The competitor actually admitted to it). Google loves ROR and won’t push it down even with tons of SEO, social media profiles, etc. Prospects walk in with a printed out ROR in hand, mention it while calling in. They can’t tell it’s a sham by a competitor.

And if you rebuttal the ROR, you just give it more SEO. A lot of times we’ve found people only read the first post, not the rebuttals.

Eric, that’s why it’s important for businesses to develop a process and program for asking for reviews and recommendations from their satisfied customer and going the extra mile to make it easy for those customers to respond to that request. If an ROR report is contradicted by several years of steady, positive reviews it won’t do much damage.

I guess you have to look at negative feedback in a different way. Turn a bad situation into a good one. Improve your practices in business and online. Learn not what to say but how to say it. I just had an experience that I have spent hours if not days turning to resolve. I tried several different approaches so now I am going to try the personal approach. I think it will work. I am a retired military member and they teach us never to give and always be nice and professional because it does not cost a cent. Sometime I think people in business forget that. I hope I never do. I hope someone learn something from this email. MY comments is simply this kill them with kindness and respect. Never lose your cool and maintain control at all times. Remember Tomorrow is just a day away. God Bless.

There’s plenty of opportunity for businesses to “prevent” negative reviews, and I recommend doing this than actually suffering the consequences of an already pissed-off customer’s feedback. Some businesses don’t care though, and by the time they realize, harm has already been done.

It’s hard to tell how customers will react because each has a different personality…as a business owner, you can only try so much.

But the #5 reason mentioned here is what makes a negative review far worth more than a positive one. If you really care about your business, you will do all you can to clean up your reputation asap. The Internet is a whole new media, wherein reactions are instantaneous. If you’re not fast, your bad review will spread like wildfire.

I agree that negative reviews are not always a bad thing. Even the best run business will have a small number of customers that end up complaining. If you are in business and you don’t get some compliants then something is wrong! The negative feedback should however show where you are going wrong and help to address the issue so the business overall improves. It’s important to learn from the feedback and improve the service offered.